Second-hand Budapest studios already cost millions per square metre. The prices have surged more than 30 percent since last year, but market analysts forecast a positive turn-around.
The prices in the housing market have been rising for years, but the 2022 increase so far was the highest spike on the graphs. While from 2020 to 2021, apartment prices in Budapest had grown by 9-14 percent, the market was still booming because people were using the new governmental aid for purchasing properties.
Even in February 2022, the prices were already on the rise even though the energy crisis had not even kicked in. At the beginning of this year, the original offer price for residential property increased by more than 3 percent. Sellers experienced brisk demand, so the prices rose even further. This price increase is inevitable, but 2022 already saw a three-fold surge compared to the already high prices back in 2016.
Buyers’ willingness to change apartments decreased because of the nationwide uncertainty, but the number of those who would purchase property for investment purposes increased. Due to the rising energy prices on the global market, the modernity and energy efficiency of the apartments may be an increasingly important aspect for buyers in the future. Small-size flats will certainly be more sought-after.
A change is forecasted
Owners of residential-use apartments will benefit from low utility costs from next year. However, there are many offices, medical clinics or apartment hotels in the city centre, which will receive sky-high energy bills from 2023. This change will push down real estate prices, and this trend can spread throughout the entire market as well, resulting in a positive turn-around.
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For now, the demand for smaller studios (especially with high energy efficiency) is very high, which is still pushing up the prices. In addition, these types of apartments are also sought by investors fleeing the real estate market due to inflation.
According to data from ingatlan.com, the average price per square meter in Budapest (in the case of apartments up to 119 square meters) in mid-September was HUF 957,000 (EUR 2350.91). This means a 20 percent price increase compared to last year’s figures. At the same time, the cost of an average studio apartment in the same size category increased by 26 percent, and in the case of 40-79 square meter apartments, the price increased by 30 percent.
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